Lee F. Parker and Diane K. Parker - Page 14




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          contrast, pictures taken at the same time in the older home show            
          that petitioners’ furniture and household goods were still                  
          located in the original building.  Consequently, we must conclude           
          that the new structure was simply not ready for residential                 
          occupancy and was not occupied before the expiration of the                 
          statutory period.                                                           
               Hence, the attempts of petitioners to comply with the                  
          statute, like those of the taxpayers in Elam, Sheahan, and                  
          Bayley, cannot be said to rise above the level of token use.  The           
          general incompleteness; the lack of major furniture, appliances,            
          and amenities; and the failure to sleep in the structure cannot             
          be overcome by petitioners’ minimal or workshop use of the                  
          structure.  Thus, since petitioners simply have not placed the              
          new structure into use as part of their residence, a denial of              
          nonrecognition treatment is required.                                       
               We therefore hold that petitioners are not entitled to defer           
          recognition under section 1034 of gain on the sale of their                 
          principal residence.  Respondent’s determination of a deficiency            
          with respect to petitioners’ 1991 taxable year is sustained.                
               To reflect the foregoing,                                              

                                                  Decision will be entered            
                                             for respondent.                          









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